Sales at US retailers fell more than
forecast in Jan, reflecting smaller receipts at gasoline
stations & declines at clothing & sporting goods stores. The 0.8% drop followed a 0.9% decrease in the
prior month, according to the Commerce Dept. The forecast called for a 0.4% decline. Sales excluding
gasoline were little changed. The back-to-back declines indicate consumer spending, the
biggest part of the economy, may be cooling after the strongest
qtr since 2006. At the same time, faster job growth &
cheaper fuel signal household purchases will keep underpinning
the US expansion. 6 of 13 major categories showed declines in Jan. Sales dropped 0.5% at automobile dealers after a 0.8% decrease the prior month. Industry sales of cars & light trucks cooled to a 16.6M annualized rate in Jan after 16.8M in Dec. Retail sales excluding autos decreased 0.9% for a 2nd month. They were projected to fall 0.5%. Cheaper gasoline depressed filling-station receipts retail sales aren’t adjusted for
prices. Purchases at filling stations slumped 9.3%, the
most since Dec 2008. Sales excluding automobiles & service stations increased
0.2%, less than the projected gain of 0.4%. The figures used to calculate GDP, which
exclude categories such as food services, auto dealers, home-improvement stores & service stations, showed a 0.1%
gain after dropping 0.3% in the previous month. Americans were cautious about spending elsewhere. Sales
decreased 0.8% at clothing chains after a 1.2%
slump a month earlier. Purchases declined 2.6% at
sporting goods outlets, 0.7% at furniture stores & 0.7% at department stores. But sales rose at non-store retailers, building material
outlets & electronics stores.

Euro-area govs left tough decisions
on the future of Greece’s bailout for next week, after talks
failed to bridge differences over the aid program that the Greek
gov blames for economic hardship. With Greece’s current bailout expiring at the end of
Feb, finance ministers met for 6 hours
without signing off on any conclusions on the way forward for
the region’s most-indebted nation. That leaves open how Greece
can avoid running out of cash & avert a possible exit from the
19-nation EU. Attention now shifts to a summit of EU leaders
on today, a day after German Chancellor Merkel & French pres Hollande traveled to meet
Russian pres Putin to negotiate a cease-fire in
Ukraine. Merkel had left bargaining with Greece to the finance
ministers. “We understand each other much, much better now than we
did this morning,” Greek Finance Minister Varoufakis told
reporters. “Europe manages to find agreements even
if it’s at the last moment.” Greece needs its next bailout installment of about €7B ($7.9B) or some other financing to keep
from defaulting on its intl debt payments. The new,
anti-austerity gov of Prime Minister Tsipras has
said it no longer wants to abide by the terms of the bailout
program, asking instead for bridge funding while negotiating a
new deal.

A last-gasp cease-fire to stem the conflict
that’s devastated eastern Ukraine & sent ties between Russia & its former Cold War foes to a more than 2-decade low
failed to ease skepticism over the prospects for peace. The accord was struck today after more than 18 hours of
non-stop talks between Ukrainian pres Poroshenko, his
Russian counterpart Vladimir Putin, Merkel & Hollande. It envisages a truce
from midnight at the start of Feb 15 & reaffirms some
commitments from a failed Sep bid to end the conflict. The collapse of previous cease-fires has stoked doubts as
to whether this one will hold. 10 months of fighting have
killed more than 5K, crushed Ukraine’s economy &
propelled Russia toward a recession thru US & European
sanctions. Raising pressure to deliver a settlement, the run-up
to the summit was accompanied by escalating violence & calls
for the US to supply weapons to Ukraine’s struggling army. “What we’ve reached now gives us more hope than if we
hadn’t agreed on anything,” Merkel said. “We don’t have any illusions that
a lot of work is still required but there’s a real chance for
things to take a turn for the better.” Highlighting the tensions still gripping eastern Ukraine,
a military spokesman said that
50 tanks crossed the border from Russia overnight along with 40
rocket launchers & 40 armored personnel carriers. 2
Ukrainian servicemen were killed in the past day, the army said. But Putin was more upbeat. “Despite all the difficulties of the negotiating process,
we managed to agree on the main things,” he said. “I
call on both sides in the conflict to stop the bloodshed as
quickly as possible and move to a genuine process of long-term
political settlement.” An initial 50-kilometer (30-mile) buffer zone will also be
established between the 2 sides, while there will be an
amnesty covering all prisoners, including Ukrainian pilot Nadiya
Savchenko, who’s being held in Russia.

Intl news is carrying the greatest weight. Even a shaky truce in the Ukraine is getting some respect by stock buyers. Unfortunately words are cheap. The day of reckoning for Greece was postponed until next week, but there is little hope for much to be accomplished in the next few days. Retail sales data is very disappointing. Low priced gas is supposed to aid retail sales. The economic recovery has been inconsistent in the last few months, not an encouraging sign for the stock market.